GOLD up, keeping up with the Rupee rise

Indian gold demand remained low on Wednesday amid firm prices, but buyers stayed on the sidelines hoping the dip earlier this month would revisit, dealers said.

"When prices fell earlier this month people waited for more falls," said Suresh Kumar, managing partner of Visakha Bullion Corp., in Visakhapatnam. "But it didn't, so now people feel if the same levels come back, they shouldn't let it go."

Indian gold prices dipped close to the psychological level of 8,500 rupees per 10 grams, touching the year's low at 8,542 rupees in the futures market on July 6.
Rupee / US Dollar Forex Currency
But prices have rebounded on bullish sentiment overseas, where a weak dollar and firm crude oil prices have hardened gold.

Dealers in Mumbai's bullion banks described demand as "weak" or "nil" but most agreed that next month could make them busy again.

India's gold buying season is expected to start next month as manufacturers would have to prepare for a slew of Hindu festivals in the following months.

Following was the price being quoted by a bullion bank in rupees per 10 grams for .995 gold at 1:15 p.m.:

Bank Wednesday Tuesday

===================================================

Kotak Mahindra 8,856 8,794

Following are gold prices in rupees per 10 grams on the Multi Commodity Exchange of India Ltd. at 2:00 p.m.:

Contract Current price Net change
Rupee / US Dollar Forex Currency News, Gold in India, and The Sensex index on the Bombay Stock Exchange (BSE). Euro / Rupee and Yen / Rupee.